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Pacton enters joint venture on advanced Red Lake project

3rd February 2020

By: Mariaan Webb

Creamer Media Contract Publishing Editor

     

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TSX-V-listed explorer Pacton Gold on Friday announced that it had entered into a letter of intent (LoI) to buy fellow-listed TomaGold’s 39.5% interest in the Sidace Lake property, in the Red Lake district, Ontario.

Sidace Lake is currently a joint venture (JV) between TomaGold, Australia’s Evolution Mining and US miner Newmont (formerly a GoldCorp asset).

Vancouver-based Pacton said it would enter the JV as project operator and that it planned to aggressively expand the mineralised zones at the project with exploration drilling.

Sidace Lake is contiguous to the company’s current claim package and is an advanced gold project with over 81 600 m of historic drilling.

Under the terms of the LoI, which would be formalised by a definitive agreement, Pacton has to pay TomaGold $250 000 and issue ten-million common shares upon final TSX-V approval. Within six months of TSX-V acceptance, pay $250 000 and issue $800 000 worth of common shares at a price per share equal to the greater of $0.16, and upon the company filing a National Instrument 43-101 technical report on the property showing a gold resource estimate of at least 750 000 oz of gold equivalent, issue 4 166 666 common shares.

“This is an excellent transaction for TomaGold and Pacton,” said TomaGold CEO David Grondin. “It will give us shares in a company with strong upside potential and enable Pacton to strengthen its land position in the Red Lake gold mining camp with a high-quality mining asset close to its Red Lake Gold project.”

Pacton executive chairperson Dale Ginn commented that Sidace Lake was an "exciting gold project with a clear path for potential growth".

The transaction is subject to the written approval of Newmont, the execution of a definitive agreement and regulatory approval.

Edited by Creamer Media Reporter

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